New Zealand’s exporters are redirecting shipments originally destined for China to other markets as demand from the country’s largest trading partner weakens, according to a senior official at the Reserve Bank of New Zealand.
“We’ve certainly seen many of our exporters looking at, and actively diverting, product that they would have been looking to put into China, into other markets as well,” Karen Silk, assistant governor at the RBNZ, told CNBC’s “Squawk Box Asia” on Thursday. “It is not the only export market.”
Silk’s comments underscore how China’s economic slowdown is rippling through businesses across the globe. Growth in the world’s second-largest economy slowed to multi-year lows in the second quarter, pressured by weak domestic demand and an ongoing property slump, according to the report.
A dominant trading partner
China has been New Zealand’s biggest trading partner and top export market, buying roughly a quarter of New Zealand’s total exports in the 12 months through July. Data from the New Zealand China Council cited by CNBC shows New Zealand’s goods exports to China in 2025 were nearly double the combined value of shipments to its next two largest markets — the U.S. and Australia.
New Zealand supplies more than half of China’s dairy imports, a position built on a bilateral trade agreement dating to 2008 that later granted duty-free access to all New Zealand dairy products from 2024. A sustained drop in Chinese demand is now testing how quickly those trade flows can be diversified.
Global disruptions and a silver lining
Adding to the pressure, the Middle East conflict and related shipping disruptions through the Strait of Hormuz have pushed up global commodity costs, further cooling Beijing’s appetite for commodity imports.
But those same supply disruptions have created an opening for New Zealand, Silk said. Elevated global commodity prices — including for wheat — have given the country’s pasture-based farmers a relative cost advantage even as volumes headed to China soften.
“In some ways, New Zealand actually benefits from a price perspective when we have those supply factors going on globally,” she said.
RBNZ hikes again
Silk spoke a day after the RBNZ raised its key interest rate by a quarter percentage point to 2.75% on Wednesday to fight inflation, and signaled another increase could follow by the end of the year. It was the central bank’s second consecutive rate hike.
Source: www.cnbc.com — https://www.cnbc.com/2026/09/03/china-new-zealand-dairy-agriculture-exports-slowdown-rbnz.html
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